[Viewpoint] Mummies tell tale of MIA economyIt sounds more like a plot of a horror film than a legitimate news story.
It began last week when Tokyo’s oldest man turned out to have been dead for 30 years, his mummified remains still sharing the family home with his daughter. But a bank account that was taking in his pension benefits was found to be alive and well.
Reports that Tokyo’s oldest woman - 113, if alive - is missing prompted a mad centenarian search. Japan is now checking on the whereabouts of 840 pensioners 85 and older. The 100-plus crowd has more than tripled to 40,399 in the past decade; it may take Japan’s entire police force to locate all of them.
This macabre tale got more attention than Toyota Motor Corp.’s sudden return to profit. It had 126 million Japanese asking any number of questions: How could we let people vanish? Do we really live the longest? How many others are decomposing in their homes? And hey, where’s granny?
Yet there are three ways in which Japan’s missing elderly scandal sheds light on the nation’s economic plight.
First, it’s an analogy for the increasingly mummified state of fast-graying Japan. With firms such as Toyota and Sony Corp. raising profit projections, it’s easy to forget that deflation is deepening. That would be less of a concern if interest rates weren’t already near zero and public debt weren’t about 200 percent of gross domestic product.
A mummy is a corpse whose skin and organs have been preserved. That’s an apt description of where the economy finds itself. Twenty years after Japan’s bubble economy burst, corporate executives are still obsessing over exchange rates.
Japan needs to increase its global competitiveness, not bellyache about the yen’s 8 percent increase this year. Corporate Japan’s skin and organs have been preserved to the detriment of its global standing.
Only one Japanese name made Fast Company magazine’s 2010 list of the world’s most innovative companies, and it was a retailer. One reason is the staid nature of Japan’s start-up universe. Another is the “Galapagos syndrome,” whereby Japan makes status-quo-shattering gadgets in isolation.
Japan’s cell phone industry is emblematic of how little regard is given to tapping new markets overseas. The nation makes cutting-edge phones, yet with features and functions that differ markedly from global standards. As the population shrinks, Japan needs to think bigger, and more internationally.
Hello Kitty offers another cautionary tale. Last week, one of Japan’s most iconic characters rang the closing bell at the New York Stock Exchange to mark creator Sanrio Co.’s 50th anniversary. Yet the 30-something feline is running out of product lives as domestic sales shrink. It’s a fitting analogy for Japan’s failure to update its global image.
Second, pockets of poverty are growing. Japanese cling to the myth that their nation is an egalitarian one. An October 2009 disclosure by the Labor Ministry dramatized the point: about one in six Japanese was below the poverty line as of 2007.
That was before the collapse of Lehman Brothers Holdings Inc. and the global financial crisis. The rate at which Japanese are sliding into poverty surely accelerated in the last three years. It has become a media obsession to chronicle the lives of the working poor in a nation that likes to pretend poverty is only a problem for others.
Part of the shock surrounding missing centenarians is the lengths to which some go to eke out a living. That someone might leave dad’s corpse in a bedroom for 30 years so she can collect his pension smacks many as more an act of desperation than depravity.
Third, taxpayer funds are wasted. Of all the skeletons in Japan’s closet, this is the one that most needs addressing. Pension scandals are common here, be it the government losing files or politicians not paying into the national scheme. Yet, Japanese are miffed about some families bilking the system.
The issue of waste doesn’t get enough attention. And as a taxpayer in Japan, I have long been outraged at the number of low-level bureaucrats that ministries send to meetings and conferences around the globe - all traveling business class and staying in swanky hotels.
Money-related investigations of politicians become so numerous and broadly based that one’s eyes glaze over. I can’t count the number of times the road in front of my home in Tokyo gets repaved in a year. For all the talk of killing bridge-to-nowhere public-works projects, lots of cement is still being dumped around the nation at this very moment.
Investors everywhere are losing tolerance for runaway public debt. That means making bold and honest efforts to get control over spending. Japan can no longer allow these challenges to fester away in the basement with grandpa.
*The writer is a Bloomberg News columnist.
By William Pesek